Mr. Tony Makuch reports

LAKE SHORE GOLD ACHIEVES 2012 PRODUCTION TARGET, COMPANY POISED FOR SHARPLY HIGHER PRODUCTION AND LOWER COSTS IN 2013

Lake Shore Gold Corp. has released operating results for the full-year and fourth quarter 2012 and has provided production and cost guidance for 2013.

Highlights

• Gold production in 2012 of 85,782 ounces (719,298 tonnes @ 3.9 grams per tonne), with gold poured from 2012 production of 85,184 ounces, in line with Company guidance
• Gold production in fourth quarter 2012 totaling 23,738 ounces (181,575 tonnes @ 4.2 grams per tonne), with gold poured of 24,041 ounces
• Key 2012 mine development and expansion objectives achieved with mining and milling capacity increased 25% to 2,500 tonnes per day (on track to reach 3,000 tonnes per day during second quarter 2013)
• Targets for 2013 include: strong production growth to between 120,000 and 135,000 ounces of gold, cash costs between US$800(1) and US$875(1) per ounce (including royalties), project spending of approximately $80 million and exploration spending of $10 million (largely related to in- mine drilling)
• Cash and bullion inventory at December 31, 2012 of approximately $61 million.

Tony Makuch, President and CEO of Lake Shore Gold, commented: "We finished 2012 strong with higher production and improved grades during the fourth quarter. For the full year, we achieved our production guidance, producing 85,782 ounces and pouring 85,184 ounces. Equally important, we met our key mine development and mill expansion objectives, including increasing both our mining and milling capacity by 25% to 2,500 tonnes per day. We remain on track to increase production capacity to 3,000 tonnes per day during the second quarter of this year.

"The progress we achieved in 2012 has positioned us for significantly higher production, reduced spending and improved cash operating costs in 2013. Production for the year is targeted at between 120,000 to 135,000 ounces of gold. Capital spending on mine development and mill expansion projects is forecast at approximately $80 million, with an additional $10 million budgeted for exploration, largely in-mine drilling. Cash operating costs in 2013 are targeted at US$800(1) to US$875(1) per ounce, including royalties."

Details of the Company's financial performance, including capital and exploration expenditures and operating costs, will be included in its full year and fourth quarter 2012 financial results to be released in March 2013.

Qualified Person

Mine development and operating activities at the Company's Timmins assets are conducted under the supervision of Dan Gagnon, Senior Vice-President, Operations. Mr. Gagnon is a qualified person as defined by National Instrument 43-101 and has reviewed and approved the information included in this news release.

We seek Safe Harbor.